LIGHTS…CAMERA…ACTION - Steve Yanovsky

It has been about a month since YouTube announced that they want to get into the programming business in a big way That is they are planning to offer their own lineup of channels So they are going to be a bit of a hybrid somewhere between Hulu and an MSO The difference is that all these channels will contain original content it will not be a presentation of offnetwork shows in a repackaged format Content creators will have a dedicated channel on the site that they will program continually refreshing what can be viewed The business proposition is that YouTube then gets to sell ad inventory against this programmingThese channels will be full of bold face names to attract viewers Lady Gaga Kobe Bryant JayZ Madonna Shaq and Ashton Kutcher How much of them you will get to view on these channels remains to be seen The lack of Oprah on OWN has been a real problem and is not generating the numbers they were looking for with this new cable networkBut the power of YouTube is not to be under estimated They get 80 of the Internet users and 47 of video views each month according to comScore This is an enviable base from which to launch new webisodic programming Wouldnamp8217t the broadcast networks love to have an audience that sizeTo get the venture started it has been reported that Google has invested 100 million This is much less than it costs to launch and then break even for a new cable network This budget is no real strain for a company with more than 40 billion in cash So they can afford to make missteps toss them aside and introduce more programming until they get it right As an investment in the future this makes a lot of sense From its original acquisition for 16 billion that many thought was a huge mistake YouTube may turn out to be an enormous winner According to Barclay Capitalamp8217s Anthony DiClemente total video advertising is forecast to generate 2 billion in revenue in 2011 With their huge share of market for video views YouTube is probably looking at 1 billion in revenue already and this new programming hasnamp8217t even startedIt was reported back in July that YouTube was going to follow the model introduced by some of the video ad networks that are and were producing their own original webisodic programming That is they were only going to produce the programming if an advertiser stepped up to pay for it The difference here is that they are looking for hefty price tags They are looking for Hulu CPMamp8217s in the 40 price range rather than the 20 price range for TV adsOne important consideration is how YouTube is going to generate awareness for this programming Just like their advertisers who are looking to generate awareness for their products this programming is going to need to get your attention According to an article in Adweek amp8220YouTube wonamp8217t be doing promotion at all It wonamp8217t beamp8230doing any of theamp8230things that get new shows noticedamp8230In television itamp8217s not the creatoramp8217s obligation to market the content and get the eyeballsamp8221 This lack of promotion could turn out to be a real stop sign for much of the programming and ultimately to potential advertisers In the same article it was stated that amp8220A source at Google however who asked not to be named said the company is rethinking its approach to promotionamp8230amp8221So YouTube will transition itself from only user generated self indulgent videos to professionally produced content with celebrities in them This is quite a transformation given how little time has occurred Will viewers know about it will they care will they watch and most importantly will they come back to view againSteve Yanovsky is a Partner at Customer Focused Solutions and can be reached at syanovskyoptonlinenetRead all Steveamp8217s MediaBizBloggers commentaries at Media MediationsCheck us out on Facebook at MediaBizBloggerscomFollow our Twitter updates MediaBizBloggerThe opinions and points of view expressed in this commentary are exclusively the views of the author and do not necessarily represent the views of MediaBizBloggerscom management or associated bloggers MediaBizBloggers is an open thought leadership platform and readers may share their comments and opinions in response to all commentaries

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LIGHTS…CAMERA…ACTION - Steve Yanovsky

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